Local stocks fall to yearly low on Turkish woes
The benchmark Kospi shed 34.34 points, or 1.5 percent, to close at 2,248.45, the lowest figure for since May 4, 2017, when it closed at 2,241.24. Trading volume was moderate at 5.85 trillion won ($5.16 billion).
The fall, shared by markets in other parts of the world, came as Turkey’s lira gradually weakened starting last week after U.S. President Donald Trump slapped stiff tariffs on Turkish steel in an apparent response to Ankara’s decision to extend the detention of Andrew Brunson, an American pastor accused of espionage. The Turkish currency has lost more than 40 percent of its value this year.
“Investors were worried over fallout from extreme currency volatility, which has already been weighed down by the stronger U.S. dollar,” said Kim Byung-yeon, an analyst at NH Investment and Securities. “Chances are slim for this case to have a long-term impact, but it will delay a serious comeback of foreign investors to the local market.”
Foreigners offloaded a net 172 billion won worth of local shares, while institutions picked up 13.3 billion won and retail investors bought a net 102.8 billion won.
Most blue chips drifted lower, with tech and bio shares dragging down the index. Top cap Samsung Electronics lost 0.77 percent to end at 45,050 won, and LG Chem slid by 1.87 percent to 368,000 won.
No. 1 steelmaker Posco retreated 2.74 percent to 319,000 won and top automaker Hyundai Motor lost 1.98 percent to 123,500 won.
Major bio firm Celltrion dipped 4.23 percent to 260,500 won after Goldman Sachs painted a bleak picture of Celltrion’s U.S. performance. Its negative prospects also affected other bio shares, causing Samsung BioLogics, Samsung’s biopharmaceutical affiliate, to drop 3.88 percent to end at 446,000 won.
Securities and insurers also lost ground, with Samsung Life Insurance decreasing 3.09 percent to 94,000 won. The secondary Kosdaq plunged 29.16 points, or 3.72 percent, to 755.65, dragged down by poor investor sentiment and institutional and foreign selling of pharmaceutical shares.
The Korean won closed at 1,133.90 won against the U.S. dollar, up 5 won from the previous trading session.
Bond prices ended lower. The yield on three-year bonds added 1.1 basis points to 2.05 percent, and the return on 10-year bonds rose 1.5 basis points to 2.51 percent.
BY KIM EUN-JIN, YONHAP [kim.eunjin1@joongang.co.kr]
with the Korea JoongAng Daily
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